DRIVERS caught using their mobiles face a huge hike in car insurance bills.

Top insurance companies may slap a 30 per cent loading on motorists convicted of what they say amounts to dangerous driving.

Many insurers said they beefed-up their policies after penalties for the offence were increased in February. The original £30 fine was raised to £60 and drivers also receive three points on their licence.

The additional insurance cost for motorists convicted of the offence varies, but Allianz adds 30 per cent to premiums.

The average annual car insurance is £682, says the AA, which means convicted motorists would pay £204 more.

It has been illegal to use a mobile phone while driving since December 2003, but the number of drivers caught breaking the law is rising.

Almost 500 were fined every day in 2006, 29 per cent up on 2005.

The government believes that up to 300,000 drivers a day still illegally use hand-held phones at the wheel.

The AA, which acts as a broker for 20 leading insurers, said it was advising companies on its panel to take the offence into account when giving quotes.

A spokesman for the motoring organisation said: "Even drivers who speed are seen as less dangerous than those using their mobile, who are not fully in control of their vehicle."